Join the Meeting Place for Moms!
Talk to other moms, share advice, and have fun!

(minimum 6 characters)

AIG and other financial institution regulation.

What do you think about changing laws to put more regulations on financial but non-bank institutions. Do you think a more closely regulated insurance/investment industry could have prevented the collapse and bail-outs?

Answer Question
 
stacymomof2

Asked by stacymomof2 at 10:12 PM on Mar. 24, 2009 in Politics & Current Events

Level 23 (18,390 Credits)
Answers (14)
  • Since I think the government CAUSED the need for the bailouts, No.
    Praying

    Answer by Praying at 10:31 PM on Mar. 24, 2009

  • government CAUSED the need for the bailouts

    Could you elaborate?
    stacymomof2

    Answer by stacymomof2 at 10:42 PM on Mar. 24, 2009

  • The gov't forced banks in lower income areas to make loans to people with bad credit and no income. How can you pay back a loan with no income? That's crazy!

    momof030404

    Answer by momof030404 at 11:09 PM on Mar. 24, 2009

  • The gov't forced banks in lower income areas to make loans to people with bad credit and no income. How can you pay back a loan with no income? That's crazy!

    How do you figure? They provided funding and incentive to encourage it. It wasn't requiring them to make so many bad loans that it created a false housing inflation which they then encouraged merrily by making more high-risk loans, which they made plenty of money on, and then sold them bundled together to other institutions. I can't believe you are so willing to jump on the government, and yet you are giving the actual companies involved in this unethical practice a total pass. Why?
    stacymomof2

    Answer by stacymomof2 at 11:16 PM on Mar. 24, 2009

  • Okay supply and demand. Because the supply of buyers with qualified loans went UP due to the gov't forcing banks to lend to non-qualified individuals to boost minority loans and "fairness" (FHA) there was a higher demand on HOMES but not enough homes to go around driving prices up and there you have the pricing BUBBLE :)

    No one is giving the companies total passes, but some of them were literally forced to give out loans to unqualified candidates to meet quotas for minorities and low incomes! Who made these requirements: Hello Clinton how ya doin old perv?
    Praying

    Answer by Praying at 11:28 PM on Mar. 24, 2009

  • Excuse me but no one forced anyone to get a loan that they couldn't really afford. Now they want us to help those that here in our state have no equity and still can't afford the loan. Go figure....grannywilson
    grannywilson

    Answer by grannywilson at 11:38 PM on Mar. 24, 2009

  • I agree with you Praying you took the words right out of my mouth :-)
    hautemama83

    Answer by hautemama83 at 11:39 PM on Mar. 24, 2009

  • Much tighter regulation of financial institutions is needed. The crazed drive for big profits and big commissions in what was the most rapidly expanding sector of the economy was the cause - the debt load was too great, hence the collapse. And big bonuses and salaries etc being paid out of taxpayers money? Since these people were the biggest exponents of free competition and deregulation, let them suffer the consequences, let them go to the wall. I wouldn't give them a cent, no need to reward corporate greed with taxpayers' money.
    janet116

    Answer by janet116 at 12:41 AM on Mar. 25, 2009

  • I feel that if banks had not been able to bundle the loans and sell them to other institutions who just sold them again and again, then much of this could have been avoided. Having to keep crap loans on their own books, would have restrained banks/lending institutions from making as many risky loans. It would also have kept faulty loans from clogging up other institutions and they wouldn't be asking the government to buy their crap right now to keep them from going under.
    Bezu

    Answer by Bezu at 7:49 AM on Mar. 25, 2009

  • Regulations need to be in place, especially because the effect of THEIR failures directly impacts America as a whole. They are basically aloud to operate OUTSIDE the law. Even the ones that are successful, they have loopholes and BARELY pay taxes...How is that legal?

    sweet-a-kins

    Answer by sweet-a-kins at 9:41 AM on Mar. 25, 2009

Join CafeMom now to contribute your answer and become part of our community. It's free and takes just a minute.

Next question in Politics & Current Events
The antichrist?

Next question overall (Just for Fun)
G rated for you?